Human capital is one of the key factors for global development, growth, and competitiveness. Which countries allow their populations to achieve their economic potential fully? Expat.com gives you an insight into the World Economic Forum's Global Human Capital Report 2017.
This study takes into account the performance of 130 countries making up 93% of the world's population and contributing 95% of the global Gross Domestic Product (GDP). Capacity (level of formal education received), development (upskilling and reskilling of the workforce), deployment (skills application and know how) are the key factors that have been assessed. The report points out that only 62% of the global human capital has been developed – the rest being either neglected or unused.
This index is overpowered by two Nordic countries, namely Norway and Finland, followed by Switzerland, the USA and Denmark. Germany, New Zealand, Sweden, Slovenia and Austria also come up in the top 10.
Europe
Nordic countries are topping most indexes for quality of life, well-being, and in this case, human capital. Norway particularly stands out for its first-class education and training, as well as the deployment and use of skills across all age groups. Norway is especially famous for its highly skilled workforce -- like Finland which owes it to its advanced education system. Denmark and Sweden come up 5th and 8th respectively for their very low unemployment rates.
Coming up 3rd, Switzerland also benefits from a highly skilled workforce thanks to its quality education and vocational training. The Swiss labour market has experienced rapid growth over the past years, even though the gap between generations has been widening. Austria ranks 10th not only for its diverse generation of graduates but also for its excellent vocational training system. The Netherlands and Belgium are in the top 20.
The United Kingdom, on the other hand, moves down to the 23rd place due to a slight decline regarding education and training even though it has a highly skilled workforce accounting for 48% of its labour market. France, for its part, ranks 26th due to poor development of its human capital – which probably explains the high unemployment rate as its active population of 25 – 54 and 55 – 64 went down by 35%.
In countries such as Portugal, Spain and Greece where human capital is poorly developed, unemployment rates remain steadily high despite government efforts.
Americas
The United States of America is the only North American country in the top 10, mainly for its human capital development index. US universities get high enrollment rates every year – which makes a significant contribution to the workforce diversity across all generations. The USA also has one of the world's lowest unemployment rates (not surprising for one of the biggest economic powerhouses) in spite of a decline among its active population.
Canada comes up 14th while its labour market accounts for over 40% of the highly skilled professionals aged 25 to 54. Like the USA, Canada also gives the opportunity to its silver workforce to choose whether they wish to remain active or not. Latin America, on the other hand, shows slight improvement with only Argentina (52) and Chile (53) being able to develop their human capital even though they have a lower-skilled workforce, unlike North America.
In Chile, the population benefits from quality education which is in favour of human capital development. Argentina's strength seems to be its diverse student population. Despite being two of the region's biggest economic powerhouses, Mexico (69) and Brazil (77) do not even make it close to the top 50. With a significant active population, Peru and Colombia come up 66th and 68th.
Africa and the Middle East
Israel (18) is the only country in the region to have developed its human capital compared to the United Arab Emirates (45), Bahrain (47) and Qatar (55) despite their quality education systems. One of the region's major economies, Saudi Arabia, ranks 82nd despite having a diverse workforce and a highly qualified and skilled population.
Meanwhile, Rwanda (71), Ghana (72), Cameroon (73) and Mauritius (74) have developed over 60% of their human capital. Turkey (75) crosses the 60% mark thanks to youth enrollment rates at both tertiary and vocational education.
Asia and Oceania
New Zealand (7) and Australia (20) need no introduction. Both countries have developed their human capital in a significant way through wide and diverse employemen conditions and outstanding education systems, resulting in low unemployment rates.
Asia's performance varies significantly from one country to another. Singapore (11), Japan (17) and South Korea (27) remain the most successful countries so far thanks to their excellence in higher education as well as their high economic growth and diverse workforce across all generations. China (34) particularly stands out for the redeployment of its human capital through quality education and continuous vocational training.
Malaysia (33) on the other hand suffers from a high female unemployment rate despite having a highly skilled workforce. Thailand comes up 40th while Vietnam and Indonesia rank 64th and 65th. Further away, India (103) is pinpointed for its youth literacy rate of 89% and high unemployment rate due to a low participation rate among its active workforce.
